Hepatitis virus infection remains a major health issue throughout the world. Although there are effective drugs and a vaccine for hepatitis B (HBV) infection, there are almost 200,000,000 people infected worldwide. It is estimated that 2 to 4% of Americans are infected with Hepatitis C Virus Infection (HCV), and it is the leading indication for liver transplantation in the western world. For HCV infection, interferon/Ribavarin therapy is expensive, difficult, and not effective in a majority of cases. New small molecule drugs are being developed, but they target a specific protein resulting in the emergence of infectious HCV quasi-species, leading to quick resistance to the therapeutic. RNA interference (RNAi) is a powerful new approach to turning off genes in cells, making it an alternative therapeutic approach to treat infectious processes. Moreover, strategies can be designed to minimize the possibility of escape mutant formation. We have had preliminary success in using a new AAV vector to achieve a safe and sustained >100 times reduction in HBV replication in a transgenic mouse model. Interestingly, we have come across some interesting biological responses to overexpression of shRNA in vivo. Our approach is to develop an RNAi gene therapeutic that would be useful for treating hepatitis virus infection. To do this we will: (1) continue to use a mouse model of HBV to study basic biological responses to shRNA expression in vivo;(2) develop robust shRNA expression sequences against HCV;and (3) test novel AAV shRNA expression cassettes in a bona-fide mouse model of HCV replication in vivo. We believe the data generated during the granting period will develop the reagents necessary to pursue a Phase I clinical trial for HCV infection.